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The 2012 Election is right around the corner. In Virginia we have been inundated with political ads for the two presidential candidates, a side-effect to living in a swing state. However, we have not seen any political ads on the proposed Constitutional Amendment on the Virginia Ballot on November 6. This article will discuss the proposed Virginia Constitutional Amendment and hopefully provide you with facts and access to information you need to make your decision next week.

Shall Section 11 of Article I of the Constitution of Virginia be amended (i) to require that eminent domain only be exercised where the property taken or damaged is for public use and, except for utilities or the elimination of a public nuisance, not where the primary use if for private gain, private benefit, private enterprise, increasing jobs, increasing tax revenue, or economic development; (ii) to define what is included in just compensation for such taking or damaging of property; and (iii) to prohibit the taking or damaging of more private property than is necessary for public use.

The history of the proposed amendment starts with the taking of private property in New London Connecticut in 2000. The City of New London approved an economic development plan to revitalize the area. The area to be revitalized included property owned by 115 private individuals. The New London Development Corporation purchased many of the properties. Negotiations with a few owners were not successful so NLDC decided to acquire the properties through eminent domain.

The NLDC initiated action against Susette Kelo and Wilhelmina Dery, amongst others. Kelo had done extensive improvements to her home, and Dery was born in her home in 1918 and lived there her entire life. The Superior Court in Connecticut upheld the taking of the Kelo and Dery properties as the Connecticut statute and Federal law permitted a taking of land, even developed land, for an economic development. Kelo and Dery appealed to the United States Supreme Court.

In the case of Kelo v. City of New London, 545 U.S. 469 (2005), the United States Supreme Court upheld the City of New London’s authority to take the Kelo and Dery properties for economic development finding that “economic development” fell under the traditionally broad understanding of public purpose. The United Supreme Court further noted that it would not “second-guess” the City’s development plan about the efficacy of the plan, or whether it needed all of the land that it was seeking to take. The United States Supreme Court emphasized that its opinion does not preclude any State from placing further restrictions on the exercise of its powers pursuant to eminent domain.

However, the 2007 amendments are subject to change by any future General Assembly. To avoid such changes by Virginia legislatures, the Constitutional amendment proposed to Virginia voters, requires any subsequent changes to be approved by the voters.

The proposed amendment to the Constitution follows the 2007 amendment to the statute by limiting the application of “public use” when taking property, and defining “just compensation.” Takings may still occur to provide utility services, but a taking based on public use is not permitted if the primary use is for private gain, private benefit, private enterprise, increasing jobs, increasing tax revenue, or economic development, except for the elimination of a public nuisance existing on the property. Just compensation paid to the property owner shall be no less than the value of the property taken, lost profits and lost access, and damages to any leftover portions of the property. The General Assembly will still have some work as the amendment, if passed, directs the General Assembly to define the terms “lost profits” and “lost access.”

There are many arguments, both for and against this constitutional amendment. Voting in favor of the amendment assures an owner that the circumstances permitting the government to exercise its power to take private property are more limited. However, passing the amendment also limits the ability of localities to engage in economic development to revitalize a community and make an attempt to spur economic growth.

Susan chairs the firm's common interest community (HOAs and Condos) practice area. She was admitted into the College of Community Association Attorneys (“CCAL”). Susan is one of fewer than 150 attorneys nationwide to be admitted to CCAL, for distinguishing herself through contributions to the evolution or practice of community association law.